2019 (7) TMI 143 - HC - VAT and Sales Tax

Principles of natural justice - main argument of the appellant was that, he was not given an opportunity to raise any objections and to produce the documents - Imposition of penalty u/s 67(1) of the Kerala Value Added Tax Act - HELD THAT - On a perusal of the orders imposing penalty it is clearly mentioned that, after conducting the shop inspection, an opportunity was afforded to the appellant by calling upon him to produce the books of accounts and also afforded an opportunity of personal hearing on 15.06.2015. But the dealer had failed to produce any documents despite two adjournments granted in that respect. It is mentioned in the said order that, after receipt of the proposal notice issued under Section 67(1) of the KVAT Act, the appellant had requested to issue copies of all the recoveries and also requested two weeks time. It is also mentioned that the appellant had obtained all the necessary copies of the recoveries, during May 2018 itself. We do not think that there occurred any denial of opportunity from the side of the authority concerned. Prima facie we are not satisfied that there occurred any violation of the principles of natural justice - However, we make it clear that the appellant has got an effective remedy to challenge the impugned order in statutory appeal. Appeal dismissed - decided against appellant.

Summary

Issues:
Challenge to judgment dismissing writ petition regarding penalty imposition under KVAT Act for 2011-12, 2012-13, and 2013-14. Allegation of denial of natural justice in not providing opportunity to respond to penalty proposal.

Analysis:
The appellant challenged the judgment dismissing the writ petition, which contested orders imposing penalties under the Kerala Value Added Tax Act for specific years. The main argument was the alleged denial of natural justice due to lack of opportunity to raise objections and present documents after the penalty proposal. The Single Judge found that the appellant had multiple opportunities within a three-month period and could appeal the decision, leading to the dismissal of the writ petition with the option to pursue statutory appeal.

The appellant contended that they were not given a fair chance to respond to the penalty proposal by presenting necessary documents. Upon review, it was revealed that the appellant's business was inspected, and they were provided with opportunities for personal hearings and objections. Despite requests for adjournments, the appellant failed to participate effectively in the process, leading to the imposition of penalties based on non-compliance with accounting regulations and tax evasion allegations.

The orders imposing penalties clearly outlined the opportunities given to the appellant for producing documents and attending personal hearings. Despite multiple adjournments and requests for time extensions, the appellant did not fully engage in the process, which was detailed in the penalty order. The Court concluded that there was no denial of opportunity or violation of natural justice based on the facts presented.

While the Court acknowledged the appellant's right to appeal the decision and present objections before the Appellate Authority, it upheld the Single Judge's judgment as no illegality, error, or impropriety was found. The appellant was advised to consider time spent on the writ petition and appeal when addressing any issues related to limitation in the appeal process. The writ appeal was dismissed, emphasizing the availability of statutory appeal for further recourse.